The FTC has lost its appeal against Microsoft’s acquisition of Activision Blizzard
The US regulator appealed the court’s decision in 2023 to allow the now-completed deal
The US Federal Trade Commission (FTC) has officially lost its appeal against Microsoft’s acquisition of Activision Blizzard.
Microsoft officially acquired Activision Blizzard in October 2023, completing the game industry’s (and Microsoft’s) biggest ever deal.
This followed the US District Court for the Northern District of California’s decision in July 2023 to deny the FTC’s motion for a preliminary injunction.
Had it been granted at the time, the injunction would have blocked the $69 billion deal from being completed until the US regulator’s in-house court had a chance to rule on whether the merger hurt competition in the games industry.
Instead, with the injunction denied, the acquisition was able to be completed. Unwilling to let the matter lie, however, the FTC proceeded with an appeal in December 2023 attempting to overturn the court’s decision.
This appeal has now been rejected, as reported by Bloomberg, with the 9th Circuit US Court of Appeals saying the judge was correct to reject the FTC’s motion for an injunction.
According to the appeals court, the FTC failed to show that Microsoft would have prevented rival companies from gaining access to Call of Duty after acquiring Activision Blizzard, now was it able to prove that the deal would have lessened competition in the gaming subscription market.
It also said the FTC’s claim that the deal would have hurt competition in cloud streaming couldn’t be proved either, because it “failed to show” that Activision Blizzard games would have been made available for streaming if the deal hadn’t gone through.
Further reading
As for the FTC’s main argument that the acquisition would potentially mean that Microsoft would make Activision games exclusive to Xbox, the appeals court pointed out that even if this was the case, it’s standard in the industry.
“All major manufacturers have engaged in this practice,” the court found, stressing that Nintendo and Sony “both have significantly higher number of exclusive games on their platform than [Microsoft] does”.
Since the acquisition was completed, Microsoft has not only continued to make Call of Duty games available on PlayStation platforms, but has also released numerous former Xbox exclusives on Sony’s console, including such titles as Forza Horizon 5, Indiana Jones and the Great Circle and Sea of Thieves.
On Monday it was also announced that Gears of War: Reloaded is coming this summer to Xbox Series X/S, PC and PS5, marking the Xbox series’ debut on PlayStation.
